Zeta Global Prepares for Potential IPO

Many tech companies are shying away from the public markets, but some are finding they have little choice: their clients demand a listing.

That’s the case with big data analytics company Zeta Global Inc., which is mulling an initial public offering as soon as this year, said David Steinberg, the company’s co-founder.

“We want to see how the market reacts under the new administration,” said Mr. Steinberg, in reference to President Donald Trump’s presidency. “It depends on how some of the bigger IPOs go earlier in the year. We’re definitely not going to be the guy to test it.”

Many of Zeta’s publicly traded customers prefer doing business with other public companies, he added. In fact, Zeta has lost business in recent years because it is still private, he said.

Some security- and compliance-conscious clients routinely audit Zeta, and they could have even more comfort if Zeta had to make routine public filings with the Securities and Exchange Commission, Mr. Steinberg added.

An IPO could make the New York company somewhat of a rarity among private companies. Despite splashy deals such as Snap Inc.’s offering, many companies are avoiding the public market. Private companies have easy access to capital, which makes going public less urgent, Mr. Steinberg said.

Zeta recently hired Jarrod Yahes as its finance chief. Mr. Yahes, 43, joined Zeta in November, after leaving his post as CFO of closely held tax preparation company Jackson Hewitt Tax Service Inc. He also served as controller, treasurer and head of investor relations at publicly traded business software company ExlService Holdings

As of last June, the number of U.S.-listed companies totaled 5,734, down by almost a third since 1997, according to the University of Chicago’s Center for Research in Security Prices. In the technology industry there were just 26 U.S. listed technology IPOs in 2016, raising $4.3 billion, according to Dealogic.

Zeta, founded in 2007, uses big data software to help companies boost their marketing. For example, the company helps airlines target passengers to check in before they fly, as opposed to at the airport, which increases their efficiency.